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Home > Prudential Regulation Authority > PRA fees and levies: model transaction fees, fees and FSCS levies for insurers and fees for designated investment firms – CP16/17
 

PRA fees and levies: model transaction fees, fees and FSCS levies for insurers and fees for designated investment firms – CP16/17

08 August 2017

Background

This consultation paper (CP) sets out the Prudential Regulation Authority’s (PRA) proposals relating to periodic fees for designated investment firms (DIFs), periodic fees and Financial Services Compensation Scheme (FSCS) levies for insurers, and fees in relation to models.

This CP is relevant to insurers and DIFs, as well as firms which have, or intend to apply in the future for, Solvency II or CRR models. The proposals relating to FSCS levies are relevant to insurance firms falling within FSCS levy classes B1 (general insurance) and C1 (life insurance), the FSCS Ltd as scheme manager, the Society of Lloyd’s and policyholders. This CP is in addition to the usual, annual consultations on fees and the FSCS management expenses levies limit.

Summary of proposals

The proposals aim to ensure that the methodologies for determining PRA fees for DIFs, life insurers and general insurers are appropriate to the risks these firms pose to the PRA objectives and, in the case of PRA fees and FSCS levies for general and life insurers, reflect the introduction of Solvency II. Other changes set out in the CP are intended to ensure that model application fees are appropriately calibrated for different fee payers, and that PRA costs associated with reviewing and maintaining firms’ models and model changes are appropriately targeted at the relevant firms.

Draft rules are set out in the appendices to this CP.

Responses and next steps

The proposed implementation date for the changes to the periodic fees and the Regulatory transaction fees: model approaches (excluding the change to CRR thresholds based on minimum eligible liabilities) is 1 March 2018. The proposed implementation date for the change to CRR thresholds based on minimum eligible liabilities is 6 December 2017. The proposed implementation date for the revised tariff base for FSCS levies is 1 April 2018 for the start of the FSCS’s 2018/19 financial year. The PRA proposes to introduce the rules relating to reporting deadlines for the FSCS levy in late 2017.

This consultation closes on 24 October 2017. The PRA invites feedback on the proposals set out in this consultation. Please address any comments or enquiries to CP16_17@bankofengland.co.uk

Consultation paper

PRA fees and levies: model transaction fees, fees and FSCS levies for insurers and fees for designated investment firms – CP16/17

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